A good budget is a
balanced budget. I am not a big fan of racking up a deficit and borrowing to fill the gap. Some of that is good, especially during the growth phase that India needs to sustain, but within limits.
In a country like India, there are two clear ways of increasing revenue, to the extent there is political will. First, cut the loopholes around the parallel black economy (especially around real estate transactions). The second is very likely to increase the tax rate on the wealthy. What income level is considered 'wealthy' will be up to debate, but my guess is that someone making Rs 1 crore a year would qualify.
There are significant inefficiencies in the system as well that ought to be looked at, perhaps by one of the marquee consulting firms, to recommend cost savings within government. The key again will be to have the will to implement the recommendations, which the decision makers themselves may not have the motivation to do.
From a venture capital and private equity standpoint, the government has to do a better job of understanding the business. India should be a very attractive destination for foreign investors. Based on my conversations in the US, people are very enamoured and excited by the numbers (population, growing middle class, young country, etc). But they are still wary of investing because they simply don't trust the regulatory regime. Especially around foreign investment and repatriation, tax issues, and rules around M&As between and among residents and non-resident entities. Until there is complete clarity and rules are made investor-friendly, the country is not going to see the
tsunami of investment that one keeps hoping for.
As told to Sarika Malhotra 
Mohanjit Jolly, Partner and Managing Director at Draper Fisher Jurvetson 
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